Hathway to demerge broadband business to subsidiary company

The company’s board of directors have given in-principle approval to demerge, transfer and vest the company’s entire broadband business into its wholly owned subsidiary, subject to requisite approvals from the shareholders, creditors, High Court(s), Department of Telecommunications, Stock Exchanges, Securities and Exchange Board of India and other applicable regulatory governmental authorities.

The carving out of the broadband business is aimed at accelerating value creation for Hathway shareholders. The separation will allow Hathway to aggressively focus on the significant growth potential for high speed data and related services in India. Globally, wireline or fixed broadband has emerged as a key driver of technology adoption and overall, GDP growth. India lags most countries including countries in Asia in wireline broadband penetration reaching only about eight per cent of the potential universe.

Hathway Broadband intends to take the lead in driving wireline broadband penetration in India and become a key player in Prime Minister Narendra Modi's Digital India initiative. The company believes that its hybrid fiber coax infrastructure on DOCSIS 3.0 platforms is the most effective and sustainable technology in a price sensitive market like India.

Hathway Cable & Datacom MD & CEO Jagdish Kumar said, “We are uniquely placed to leverage our leading position in the cable television industry and our brand to provide Indian subscribers with a world class broadband experience. This restructuring recognises that the market dynamics of the broadband business are unique as compared to our parent cable television business. The separation is a step towards increasing the broadband business' customer focus and market competitiveness and in delivering a superior value proposition to our subscribers.”